We test whether foreign investors price foreign exchange risk differently from local investors. Drawing from the closed-end country fund literature, we argue that both differential access to information by foreign versus local investors and different sources of exchange risk that investors face...

Taking the case of high-pressure political reforms including the ongoing anti-corruption campaign in China, we investigate the impact of such reforms on the performance of Chinese state-owned enterprises (SOEs) relative to non-SOEs from the agency problem perspective. We report that before the...

This paper examines an optimal underwriter participation model and develops testable hypotheses regarding the influence of certain factors on the degree of underwriter participation in initial public offerings (IPOs) of common stock. The issue of underwriter participation is important primarily...

Purpose -The purpose of this paper is to empirically examine the relation between financial leverage and investment opportunities of Chinese industrial firms, which operate in a vastly different financial environment than USA and Japanese firms. Design/methodology/approach -Multivariate...

We examine the effect of risk covenants in bond indentures on agency costs of debt and equity and stockholder wealth by testing two competing hypotheses for issuing event risk-protected bonds: the stockholder wealth enhancement hypothesis and the managerial entrenchment hypothesis. We find that...